1. Jarrett, Anne T. MS, RPh

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Reimbursement represents just one of many issues that pharmacy directors have to address these days. Medication reconciliation, quality measures, medication safety, and the ever-present Joint Commission standards make up some of their other concerns. Compounding these responsibilities is the difficult task of staying current with the overwhelmingly frequent changes in reimbursement rules.


But as you know, it's imperative that you, or someone in your pharmacy department, possess a working knowledge of reimbursement management. This person (or persons) also must be able to effectively network with those hospital staff members involved in the claim-submission and payment process.


Meeting the challenge

We only have to think about the millions of dollars that hospital pharmacy directors budget for annually to appreciate the importance of reimbursement. It's also a given that drug prices will continue to rise, which will increase the pressure put on pharmacy directors to cut costs without compromising quality. (Does this sound familiar?) We are well aware that decreased reimbursement results in less profit, which results in a diminished bottom line. This has a negative effect on the ability to procure important "must-haves," such as competitive salaries, adequate staffing levels, low turnover rates, computer-based technology, and automation, to name a few.


Ultimately, all hospitals, no matter what their size or scope, aspire to survive financially to enable them to provide the best possible care for patients-healthcare's primary customers. This desire is, after all, the reason we entered the pharmacy profession in the first place.


Did you know?

Although the topic of pharmaceutical reimbursement is a huge one, there are many smaller billing and coverage tips, including those below, that may help you receive appropriate payments most of the time.


* When given for approved indications, Medicare reimburses hospitals for bloodclotting factors administered to inpatients and also provides a handling fee.


* Patients treated in a day hospital or emergency room will be classified as outpatients even if an inpatient pharmacy is the source of their drugs. Therefore, outpatient reimbursement rules apply, not inpatient rules.


* Many drugs aren't eligible for payment despite the fact that HCPCS codes have been assigned to them. Examples include J7516 (cyclosporine, parenteral, 250 mg) and J9060 (Cisplatin, powder or solution, per 10 mg).


* HCPCS drug codes aren't limited to J codes. You'll also find drug codes beginning with the letters C, G, P, and Q-as well as in the 90XXX range (e.g., 90733 for meningococcal vaccine).


* Medical coders aren't trained to look at drugs when examining and processing an inpatient's medical chart. However, they should be taught when to look for blood-clotting factors-the only drug Medicare will reimburse for inpatients.


* A hospital's fiscal intermediary pays for treatment of inpatients with Medicare Part A and also pays for the treatment of hospital outpatients, even though they're covered under Medicare Part B.


* The drug manufacturer Novo recently established a policy that, under certain conditions, it will replace Factor VIIa (NovoSeven) administered to undocumented immigrants. The company information states, "Novo will consider all inhibitor patients for assistance in the SevenSecure program."


* Medicare reimburses for drugs given in a hospital clinic at the same rate as those administered in a physician-owned setting. Note, though, that many drugs are eligible for reimbursement when administered in a physician-owned clinic or office but not if given in a hospital clinic setting.


* It's possible to contract "carve-outs" (a payment above and beyond the normal overall contract fee) for expensive drugs when negotiating managed care contracts.


* In-house dialysis centers are required to have a separate Medicare provider number and bill type under which all drugs and supplies are charged.



Anne T. Jarrett, MS, RPh


Former Assistant Director of Pharmacy and Reimbursement, Wake Forest University Baptist Medical Center, Winston-Salem, N.C.